IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUNE . , , BEFORE SHRI D. KARUNAKARA RAO , AM AND SHRI VIKAS AWASTHY, JM SL. NO. ITA NO. / C .O. NO. NAME OF APPELLANT NAME OF RESPONDENT ASST. YEAR 1 - 3 50/ PUN/201 2 51/PUN/2012 52/PUN/2012 DCIT, CIRCLE - 1, NASHIK. VASANT RAO DADA PATIL S.S.K. LTD., VITTHEWADI, TAL. KALWAN, NASHIK. PAN : N/A 1992 - 93 1994 - 95 1996 - 97 4 - 6 76/PUN/2012 77/PUN/2012 78/PUN/2012 VASANT RAO DADA PATIL S.S.K. LTD., VITTHEWADI, TAL. KALWAN, NASHIK. PAN : N/A ACIT, CIRCLE - 1, NASHIK. 1992 - 93 1994 - 95 1996 - 97 7 2140/PUN/2012 DCIT, CIRCLE - 1, KOLHAPUR. KUMBHI KASARI SAHAKARI SAKHAR KARKHANA LTD., KUDITRE, TAL. KARVEER, DIST. KOLHAPUR. PAN : AAAAK0363M 2009 - 10 8 - 11 1423/PUN/2011 1424/PUN/2011 1425/PUN/2011 1426/PUN/2011 MANJARA SHETKARI SAHAKARI SAKHAR KARKHANA LTD., CHINCHOLIRAO (WADI), LATUR. PAN : AAAAM1527D D CIT, SPL. RANGE - 2, AURANGABAD . 199 1 - 9 2 199 5 - 9 6 199 8 - 9 9 2001 - 02 12 - 15 1462/PUN/2011 1463/PUN/2011 1464/PUN/2011 1484/PUN/2011 ACIT, CIRCLE - 3, NANDED. MANJARA SHETKARI SAHAKARI SAKHAR KARKHANA LTD., VILASNAGAR, CHINCHOLIRAO (WADI), DIST. LATUR. PAN : AAAAM1527D 1991 - 92 1995 - 96 1998 - 99 2001 - 02 16 - 17 1437/PUN/2011 647 /PUN/2014 SHRI VRIDHESHWAR SAHAKARI SAKHAR KARKHANA LTD., A/POST: VRIDHESHWAR SAKHAR KARKHANA, TAL. PATHARDI, DIST. AHMEDNAGAR. PAN: AA BCV0782E DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. 2007 - 08 2010 - 11 18 1492/PUN/2011 KADWA SAHAKARI SAKHAR KARKHANA LTD., RAJ ARAMNAGAR, MATEREWADI, DINDORI, NASHIK. ACIT, CIRCLE - 1, NASHIK. 1998 - 99 2 SSK GROUP CASES PAN: AAAAK1052K 19 2600/PUN/2012 SHRI SOMESHWAR SSK LTD., TAL. BARAMATI, DIST. PUNE PAN: AAAAS2034B DCIT, CIRCLE - 6, PUNE. 2009 - 10 20 2562/PUN2012 ITO, WARD - 11(3), PUNE. M/S KARMAYO GI SHANKARRAOJI PATIL SAHAKARI SAKHAR KARKHANA LTD., A/P. MAHATMA PHULE NAGAR, INDAPUR, TAL. INDAPUR, DIST. PUNE PAN: AAAAI0225M 2009 - 10 21 2122/PUN/2012 PADAMSHREE DR. DY. PATIL SAHAKARI SAKHAR KARKHANA LTD., DNYANSHANTINAGAR, TAL. GAGANBAVADA, DIST. KOLHAPUR. PAN: AAAAS6831N ACIT, CIRCLE - 1, KOLHAPUR. 2009 - 10 22 - 24 2134/PUN/2012 2135/PUN/2012 2135/PUN/2012 DCIT, CIRCLE - 1, KOLHAPUR. PADAMSHREE DR. DY. PATIL SAHAKARI SAKHAR KARKHANA LTD., DNYANSHANTINAGAR, TAL. GAGANBAVADA, DIST. KOLHAPUR. PAN: AAAA S6831N 2007 - 08 2008 - 09 2009 - 10 25 681/PUN/2014 DCIT, CIRCLE - 3, NANDED. PRIYADARSHANI SHETKARI SAHAKARI SAKHAR KARKHANA LTD., ARVIND NAGAR, TAL. UDGIR, DIST. LATUR. PAN: AAAAP1262G 2007 - 08 26 - 28 1026/PUN/2012 1027/PUN/2012 25/PUN/2013 YASHWANT RAO MOHITE KRISHNA SSK LTD., SHIVNAGAR, TAL. KARAD, DIST. SATARA. PAN: AAAAK0946L DCIT, SATARA CIRCLE, SATARA. 2007 - 08 2008 - 09 2009 - 10 3 SSK GROUP CASES 29 - 30 157/PUN/2013 158/PUN/2013 APPASAHEB NALAWADE GADHINGLAJ TALUKA SAHAKARI SAKHAR KARKHANA LTD., A/P HARALI, TAL. GADHIN GLAJ, KOLHAPUR. PAN: AAAAG0574A ACIT, CIRCLE - 1, KOLHAPUR. 2008 - 09 2009 - 10 31 700/PUN/2014 ASHOK SAHAKARI SAKHAR KARKHANA LTD., ASHOK NAGAR, TAL. SHRIRAMPUR, DIST. AHMEDNAGAR. PAN: AACCK3452B ACIT, CIRCLE AHMEDNAGAR, AHMEDNAGAR 2010 - 11 32 1215/PUN/2014 ACIT, CIRCLE AHMEDNAGAR, AHMEDNAGAR ASHOK SAHAKARI SAKHAR KARKHANA LTD., ASHOK NAGAR, TAL. SHRIRAMPUR, DIST. AHMEDNAGAR. PAN: AACCK3452B 2008 - 09 33 97/PUN/2015 DCIT, CIRCLE - 10, PUNE. BHIMA SAHAKARI SAKHAR KARKHANA LTD., DATTATRAY NAGAR, PARGAON BK, TAL. AMBEGAON, DIST. PUNE. PAN: AAAAB0949G 2008 - 09 34 2171/PUN/2016 ACIT, CIRCLE - 3, AURANGABAD. AMBAJOGAI SAHAKARI SAKHAR KARKHANA LTD., AMBASAKHAR, AMBAJOGAI, DIST. BEED. PAN: AAAAA1196L 1992 - 93 35 333/PUN/2012 HUTATMA KISAN AHIR SAHAKARI SAKHAR KARKHANA LTD., AT POST. WALWA, TAL. WALWA, SANGALI. PAN: AAAAH0391L DCIT, CIRCLE - 2, SANGALI. 2007 - 08 36 - 38 2124/PUN/2012 608/PUN/2012 609/PUN/2012 ACIT, CIRCLE - 2, SANGALI. HUTATMA KISAN AHIR SAHAKARI SAKHAR KARKHANA LTD., AT POST. WALWA, TAL. WALWA, SANGALI. PAN : AAAAH0391L 2003 - 04 2007 - 08 2008 - 09 39 - 41 2163/PUN/2012 2164/PUN/2012 2165/PUN/2012 DCIT, ICHALKARANJI CIRCLE, ICHALKARANJI. JAWAHAR SHETKARI SAHAKARI SAKHAR KARKHANA LTD., 2007 - 08 2008 - 09 2009 - 10 4 SSK GROUP CASES HUPARI, KALLAPPANNA, AWADENAGAR, HUPARI - YALGUD, TAL. HATKANANAGLE, DIST. KOLHAPU R. PAN: AAAAJ0571C 42 1818/PUN/2016 KARMAYOGI SHANKARRAOJI PATIL SSK LTD., A/P MAHTMA PHULE NAGAR, TAL. INDAPUR, DIST. PUNE. PAN: AAAAI0225N ITO, WARD - 14(5), PUNE. 2012 - 13 43 874/PUN/2014 KARMVEER SHANKARRAO KALE SAHAKARI SAKHA R KARKHANA LTD., GAUTAMNAGAR, POST. KOLPEWADI, TAL. KOPARGAON, DIST. AHMEDNAGAR. PAN: AAATT3070H ACIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. 2010 - 11 44 - 45 601/PUN/2012 602/PUN/2012 ACIT, CIRCLE - 2, KOLHAPUR. SHRI CHH. RAJARAM SAHAKARI SAKHAR KARKHANA LTD., S.NO. 69, E WARD, KASABA BAWADA, KOLHAPUR. PAN: AAAAS4219A 2007 - 08 2008 - 09 46 134/PUN/2013 SHRI CHH. RAJARAM SAHAKARI SAKHAR KARKHANA LTD., S.NO.69, E WARD, KASABA BAWADA, KOLHAPUR. PAN: AAAAS4219A ACIT, CIRCLE - 2, KOLHAPUR. 2009 - 10 47 2606/PUN/2012 SHREE SID HESHWAR SSK LTD., TIKEKARWADI, TAL. NORTH SOLAPUR, DIST. SOLAPUR. PAN: AAAAS3729F ACIT, CIRCLE - 1, SOLAPUR. 2009 - 10 48 - 49 42/PUN/2012 43/PUN/2012 TERNA SHETKARI SAHAKARI SAKHAR KARKHANA LTD., TERNANAGAR, DHOKI, DIST. OSMANABAD. PAN: AAAAT3653M DCIT, SPEC IAL RANGE - 2, AURANGABAD. 1992 - 93 1995 - 96 5 SSK GROUP CASES 50 - 53 82/PUN/2012 83/PUN/2012 84/PUN/2012 55/PUN/2012 AGASTI SAHAKARI SAKHAR KARKHANA LTD., POST. AKOLE, TAL. AKOLE, DIST. AHMEDNAGAR. PAN: AAAAA1262B DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. 1993 - 94 1998 - 99 2001 - 02 2 011 - 12 54 - 56 136/PUN/2012 137/PUN/2012 138/PUN/2012 SAMARTH SAHAKARI SAKHAR KARKHANA LTD., ANKUSHNAGAR, TAL. AMBAD, DIST. JALANA. PAN: N/A DCIT, CIRCLE - 1, AURANGABAD. 1992 - 93 1998 - 99 1999 - 2000 57 - 59 298/PUN/2012 299/PUN/2012 300/PUN/2012 ACIT, CIRCLE - 1, AURANGABAD. SAMARTH SAHAKARI SAKHAR KARKHANA LTD., ANKUSHNAGAR, TAL. AMBAD, DIST. JALANA. PAN: N/A 1992 - 93 1998 - 99 1999 - 2000 60 257/PUN/2012 SHIRPUR SHETKARI SAHAKARI SAKHAR KARKHANA LTD., A/P SHIVAJINAGAR, DAHIWAD, TAL. SHIRPUR, DIST. DHULE. PAN: N/A JCIT, SPECIAL RANGE - 1, NASHIK. 1996 - 97 61 2084/PUN/2012 SHRI CHHATRAPATI SAHAKARI SAKHAR KARKHANA LTD., A/P BHAVANINAGAR, TAL. INDAPUR, DIST. PUNE. PAN: AAAAS3869G ACIT, CIRCLE - 6, PUNE. 2009 - 10 62 2254/PUN/2012 ACIT, CIRCLE - 6, PUNE. SHRI CHHATRAPATI SAH AKARI SAKHAR KARKHANA LTD., A/P BHAVANINAGAR, TAL. INDAPUR, DIST. PUNE. PAN: AAAAS3869G 2009 - 10 63 391/PUN/2013 DCIT, ICHALKARANJI CIRCLE, ICHALKARANJI, DIST. KOLHAPUR. JAWAHAR SHETKARI SAHAKARI SAKHAR KARKHANA LTD., SHRI KALLAPPANNA, AWADENAGAR, HUPARI , DIST. KOLHAPUR. PAN: AAAAJ0571C 1998 - 99 64 1023/PUN/2014 MULA SAHAKARI SAKHAR KARKHANA LTD., AT POST. SONAI, TAL. NEWASA, DIST. ACIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. 2010 - 11 6 SSK GROUP CASES AHMEDNAGAR. PAN: AAAAM1145M 65 804/PUN/2014 PURNA SAHAKARI SAKHAR KARKHANA LT D., BASMATH NAGAR, TAL. BASMATH NAGAR, DIST. HINGOLI. PAN: AAAAP0899B ACIT, CIRCLE - 1, AURANGABAD. 2010 - 11 66 1254/PUN/2014 ACIT, CIRCLE - 1, AURANGABAD. PURNA SAHAKARI SAKHAR KARKHANA LTD., BASMATH NAGAR, TAL. BASMATH NAGAR, DIST. HINGOLI. PAN: AAAAP0899B 2010 - 11 67 - 70 2293/PUN/2014 2294/PUN/2014 2295/PUN/2014 2296/PUN/2014 DCIT, CIRCLE - 10, PUNE. SHRI VIGHNAHAR SAHAKARI SAKHAR KARKHANA LTD., NIVRUTTINAGAR, DHALEWADI, TAL. JUNNAR, DIST. PUNE. PAN: AAAAS2033G 2003 - 04 2004 - 05 2005 - 06 2006 - 07 71 2161/PUN/20 12 DCIT, ICHALKARANJI CIRCLE, ICHALKARANJI, DIST. KOLHAPUR. SHARAD SAHAKARI SAKHAR KARKHANA LTD., NARANDE, TAL. HATKANANGAL, DIST. KOLHAPUR. PAN: AAFCS3763E 2007 - 08 72 2594/PUN/2012 ACIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. DNYANESHWAR SAHAKARI SAKHAR KARK HANA LTD., DNYANESHWAR NAGAR, BHENDE (BK), TAL. NEWASA, DIST. AHMEDNAGAR. PAN: AAAAS4092H 2009 - 10 73 1181/PUN/2016 ACIT, CIRCLE - 1, JALGAON. M/S MADHUKAR SAHAKARI SAKHAR KARKHANA LTD., FAIZPUR KARKHANA SIGHT, FAIZPUR, YAWAL, JALGAON. PAN: AAAAM1574A 2011 - 12 74 C.O. NO.16/PUN/2018 M/S MADHUKAR SAHAKARI SAKHAR KARKHANA LTD., FAIZPUR KARKHANA ACIT, CIRCLE - 1, JALGAON. 2011 - 12 7 SSK GROUP CASES SIGHT, FAIZPUR, YAWAL, JALGAON. PAN: AAAAM1574A 75 1913/PUN/2016 DCIT, CIRCLE - 1, JALGAON. M/S CHOPDA SHETKARI SAHAKARI SAKHAR KARKHA NA LTD., A/P CHAHARDI, TAL. CHOPDA, JALGAON. PAN: AAATC2138H 2011 - 12 76 2064/PUN/2016 M/S CHOPDA SHETKARI SAHAKARI SAKHAR KARKHANA LTD., A/P CHAHARDI, TAL. CHOPDA, JALGAON. PAN: AAATC2138H DCIT, CIRCLE - 1, JALGAON. 2011 - 12 77 - 80 2283/PUN/2012 730/PUN/20 14 731/PUN/2014 732/PUN/2014 DNYANESHWAR SAHAKARI SAKHAR KARKHANA LTD., A/P DNYANESHWAR NAGAR, BHENDE (BK), TAL. NEWASA, DIST. AHMEDNAGAR. PAN: AAAAS4092H DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR. 2009 - 10 2006 - 07 2008 - 09 2010 - 11 81 - 83 571/PUN/2011 572/PUN/20 11 574/PUN/2011 ACIT, CIRCLE - 1, AURANGABAD. SANT EKNATH SAHAKARI SAKHAR KARKHANA LTD., PAITHAN, DIST. AURANGABAD. PAN: N/A 1992 - 93 1999 - 2000 1998 - 99 84 - 85 1089/PUN/2011 1090/PUN/2011 MAZALGAON SAHAKARI SAKHAR KARKHANA LTD., A/P SUNDARNAGAR, TAL. TELGAON , DIST. BEED. PAN: AAABM0171G DCIT, CIRCLE - 1, AURANGABAD. 1995 - 96 1999 - 2000 86 678/PUN/2014 MAZALGAON SAHAKARI SAKHAR KARKHANA LTD., A/P SUNDARNAGAR, TAL. TELGAON, DIST. BEED. PAN: AAABM0171G ACIT, CIRCLE - 2, AURANGABAD. 2008 - 09 87 - 88 1210/PUN/2011 1 211/PUN/2011 ACIT, CIRCLE - 2, AURANGABAD. MAZALGAON SAHAKARI SAKHAR KARKHANA LTD., A/P SUNDARNAGAR, TAL. TELGAON, DIST. BEED. PAN: AAABM0171G 1995 - 96 1999 - 2000 8 SSK GROUP CASES 89 1418/PUN/2011 PD. DR. VI THALRAO VIKHE PATIL SAHAKARI SAKHAR KARKHANA LTD., AT POST. PRAVARA NAGAR, TAL. RAHATA, DIST. AHMEDNAGAR. PAN: AAAAP0848A DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR 2001 - 02 90 - 91 1601/PUN/2011 1602/PUN/2011 M/S MADHUKAR SAHAKARI SAKHAR KARKHANA LTD., NHAVI MARG, FAIZPUR, DIST. JALGAON. PAN: N/A DCIT, SPECIAL RANGE - 1 NASHIK. 19 94 - 95 1995 - 96 92 - 93 1625/PUN/2011 1626/PUN/2011 DCIT, SPECIAL RANGE - 1 NASHIK. M/S MADHUKAR SAHAKARI SAKHAR KARKHANA LTD., NHAVI MARG, FAIZPUR, DIST. JALGAON. PAN: N/A 1994 - 95 1995 - 96 94 2451/PUN/2012 ACIT, CIRCLE - 1, NASHIK. KADWA SAHAKARI SAKHAR KARKHAN A LTD., RAJAMARM NAGAR, MATEREWADI, DINDORI, DIST. NASHIK. PAN: AAAAK1052F 2009 - 10 95 - 96 2530/PUN/2012 2532/PUN/2012 ACIT, CIRCLE - 1, SANGLI. KRANTI SSK LTD., A/P KUNDAL, TAL. PULAS, DIST. SANGLI. PAN: AAAAK1277C 2007 - 08 2009 - 10 ASSESSEE (S) REPRESENT ED BY SHRI SUBHADHA KOPPA SHRI PRATIK SANDBHOR SHRI PRAMOD SHINGTE SHRI K. SRINIVASAN SMT. DEEPA KHARE NONE APPEARED SL.NOS. 7 , 21 - 25, 29 - 30, 34 - 38, 44 - 46, 48 - 49, 75 - 76, 81 - 83, REVENUE BY MS. NANDITA KANCHAN DATE (S) OF HEARING 1 8 - 03 - 2019 DATE OF PRONOUNCEMENT 20 - 03 - 2019 9 SSK GROUP CASES / ORDER PER BENCH : T H ESE BUNCH OF APPEALS BY THE ASSESSEES AND THE REVENUE FOR THE VARIOUS ASSESSMENT YEARS MENTIONED IN THE CAPTION ARE DIRECTED AGAINST THE ORDER S OF COMMISSIONER OF INCOME TAX (APPEALS) . ALL THE ASSESSEES IN THE PRESENT SET OF APPEALS ARE ENGAGED IN MANUFACTURING OF WHITE SUGAR. THE PRIMARY ISSUES RAISED IN THESE APPEALS ARE : I . EXCESS CANE PRICE PAID BY THE ASSESSEE S TO SUGARCANE SUPPLIERS, I.E. THE PRICE OVER AND ABOVE THE S TATUTORY M INIMUM P RICE (SMP) FIXED BY STATE GOVERNMENT FOR PURCHASE OF CANE. II . ADDITION ON ACCOUNT OF SALE OF SUGAR AT CONCESSIONAL RATE TO THE MEMBERS /SHAREHOLDERS BY THE ASSESSEES . APART FROM THE ABOVE TWO PRIMARY ISSUES FOLLOWING ISSUES HAVE ALSO EMERGED IN SOME OF THE APPEALS : I . DISALLOWANCE OF CONTRIBUT ION TOWARDS A REA D EVELOPMENT F UND. II . PROVISION FOR VASANTDADA SUGAR INSTITUTE (VSI) CONTRIBUTION. III . DISALLOWANCE OF EMPLOYEES CONTRIBUTION TOWARDS PF. IV . ADDITION ACCOUNT OF CONTRIBUTION TOWARDS CHIEF MINISTER RELIEF FUND. V . DISALLOWANCE OF INTEREST U/S. 43B. VI . DISAL LOWANCE OF CANE HARVESTING AND TRANSPORTATION EXPENDITURE. 10 SSK GROUP CASES 2. THE LD. AUTHORISED REPRESENTATIVES APPEARING ON BEHALF OF THE VARIOUS ASSESSEES AND MS. NANDITA KANCHAN REPRESENTING THE DEPARTMENT SUBMITTED AT THE OUTSET THAT THE ISSUES RAISED IN PRESENT SE T OF APPEALS BY THE ASSESSEES AND THE REVENUE HAVE ALREADY BEEN CONSIDERED AND ADJUDICATED BY THE CO - ORDINATE BENCH OF TRIBUNAL IN BUNCH OF APPEALS . THE FACTS AND ISSUES RAISED IN PRESENT APPEALS ARE SIMILAR. THE L D. DR FURNISHED COPY OF ORDER OF TRIBUNA L DATED 14 - 03 - 2019 VIDE WHICH BUNCH OF 162 APPEALS WERE DISPOSED OF BY THE CO - ORDINATE BENCH , T HE LEAD CASE BEING MAJALGAON SAHAKARI SAKHAR KARKHANA LTD. VS. ACIT IN ITA NO. 308/PUN/2018 FOR THE ASSESSMENT YEAR 2013 - 14. 3. AFTER H EARING BOTH THE SIDES AND AFTER CONSIDERING THE ORDER OF CO - ORDINATE BENCH IN THE CASE OF MAJALGAON SAHAKARI SAKHAR KARKHANA LTD. VS. ACIT (SUPRA) ETC. , WE OBSERVE THAT THE ISSUES RAISED IN THE PRESENT SET OF APPEALS HAVE ALREADY BEEN CONSIDERED AND DECIDED BY THE CO - ORDINATE B ENCH . EXCESS CANE PRICE PAID TO SUGARCANE SUPPLIERS 4. THE CO - ORDINATE BENCH AFTER CONSIDERING THE JUDGMENT OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF CIT VS. TASGAON TALUKA S.S.K. LTD. REPORTED AS 103 TAXMANN.COM 57 HAS DECIDED THIS ISSUE AS UN DER : 5. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD. THERE IS CONSENSUS AD IDEM BETWEEN THE RIVAL PARTIES THAT THE ISSUE OF PAYMENT OF EXCESSIVE PRICE ON PURCHASE OF SUGARCANE BY THE ASSESSES IS NO MORE RES INTEGRA IN VIEW OF THE RECENT JUDGMENT OF HONBLE SUPREME COURT IN CIT VS. TASGAON TALUKA S.S.K. LTD. (2019) 103 TAXMANN.COM 57 (SC). THE HONBLE APEX COURT, VIDE ITS JUDGMENT DATED 05 - 03 - 2019, HAS ELABORATELY DEALT WITH THIS ISSUE. IT RECORDED THE FACTUAL MATRI X THAT THE ASSESSEE IN THAT CASE PURCHASED AND CRUSHED SUGARCANE AND PAID PRICE FOR THE PURCHASE DURING CRUSHING SEASONS 1996 - 97 AND 1997 - 98, FIRSTLY, AT THE TIME OF PURCHASE OF SUGARCANE AND THEN, LATER, AS PER THE MANTRI COMMITTEE ADVICE. IT FURTHER NOT ED THAT THE PRODUCTION OF SUGAR IS 11 SSK GROUP CASES COVERED BY THE ESSENTIAL COMMODITIES ACT, 1955 AND THE GOVERNMENT ISSUED SUGAR CANE (CONTROL) ORDER, 1966, WHICH DEALS WITH ALL ASPECTS OF PRODUCTION OF SUGARCANE AND SALES THEREOF INCLUDING THE PRICE TO BE PAID TO THE CA NE GROWERS. CLAUSE 3 OF THE SUGAR CANE (CONTROL) ORDER, 1966 AUTHORIZES THE GOVERNMENT TO FIX MINIMUM SUGARCANE PRICE. IN ADDITION, THE ADDITIONAL SUGARCANE PRICE IS ALSO PAYABLE AS PER CLAUSE 5A OF THE CONTROL ORDER, 1966. THE AO IN THAT CASE CONCLUDE D THAT THE DIFFERENCE BETWEEN THE PRICE PAID AS PER CLAUSE 3 OF THE CONTROL ORDER, 1966 DETERMINED BY THE CENTRAL GOVERNMENT AND THE PRICE DETERMINED BY THE STATE GOVERNMENT UNDER CLAUSE 5A OF THE CONTROL ORDER, 1966, WAS IN THE NATURE OF `DISTRIBUTION OF PROFITS AND HENCE NOT DEDUCTIBLE AS EXPENDITURE. HE, THEREFORE, MADE AN ADDITION FOR SUCH SUM PAID TO MEMBERS AS WELL AS NON - MEMBERS. WHEN THE MATTER FINALLY CAME UP BEFORE THE HONBLE APEX COURT, IT NOTED THAT CLAUSE 5A WAS INSERTED IN THE YEAR 1974 ON THE BASIS OF THE RECOMMENDATIONS MADE BY THE BHARGAVA COMMISSION, WHICH RECOMMENDED PAYMENT OF ADDITIONAL PRICE AT THE END OF THE SEASON ON 50:50 PROFIT SHARING BASIS BETWEEN THE GROWERS AND FACTORIES, TO BE WORKED OUT IN ACCORDANCE WITH THE SECOND SCH EDULE TO THE CONTROL ORDER, 1966. THEIR LORDSHIPS NOTED THAT AT THE TIME WHEN ADDITIONAL PURCHASE PRICE IS DETERMINED/FIXED UNDER CLAUSE 5A, THE ACCOUNTS ARE SETTLED AND THE PARTICULARS ARE PROVIDED BY THE CONCERNED CO - OPERATIVE SOCIETY AS TO WHAT WILL BE THE EXPENDITURE AND WHAT WILL BE THE PROFIT ETC. CONSIDERING THE FACT THAT STATUTORY MINIMUM PRICE (SMP), DETERMINED UNDER CLAUSE 3 OF THE CONTROL ORDER, 1966, WHICH IS PAID AT THE BEGINNING OF THE SEASON, IS DEDUCTIBLE IN THE ENTIRETY AND THE DIFFERENCE BETWEEN SMP DETERMINED UNDER CLAUSE 3 AND SAP/ADDITIONAL PURCHASE PRICE DETERMINED UNDER CLAUSE 5A, HAS AN ELEMENT OF DISTRIBUTION OF PROFIT WHICH CANNOT BE ALLOWED AS DEDUCTION, THE HONBLE SUPREME COURT REMITTED THE MATTER TO THE FILE OF THE AO FOR CONSI DERING THE MODALITIES AND MANNER IN WHICH SAP/ADDITIONAL PURCHASE PRICE/FINAL PRICE IS DECIDED. HE HAS BEEN DIRECTED TO CARRY OUT AN EXERCISE OF CONSIDERING ACCOUNTS/BALANCE SHEET AND THE MATERIAL SUPPLIED TO THE STATE GOVERNMENT FOR THE PURPOSE OF DECIDI NG/FIXING THE FINAL PRICE/ADDITIONAL PURCHASE PRICE/SAP UNDER CLAUSE 5A OF THE CONTROL ORDER, 1966 AND THEREAFTER DETERMINE AS TO WHAT AMOUNT WOULD FORM PART OF THE DISTRIBUTION OF PROFIT AND THE OTHER AS DEDUCTIBLE EXPENDITURE. THE RELEVANT FINDINGS OF T HE HONBLE APEX COURT ARE REPRODUCED AS UNDER: - 9.4. ..... THEREFORE, TO THE EXTENT OF THE COMPONENT OF PROFIT WHICH WILL BE A PART OF THE FINAL DETERMINATION OF SAP AND/OR THE FINAL PRICE/ADDITIONAL PURCHASE PRICE FIXED UNDER CLAUSE 5A WOULD CERTAINLY B E AND/OR SAID TO BE AN APPROPRIATION OF PROFIT. HOWEVER, AT THE SAME TIME, THE ENTIRE/WHOLE AMOUNT OF DIFFERENCE BETWEEN THE SMP AND THE SAP PER SE CANNOT BE SAID TO BE AN APPROPRIATION OF PROFIT. AS OBSERVED HEREINABOVE, ONLY THAT PART/COMPONENT OF PROF IT, WHILE DETERMINING THE FINAL PRICE WORKED OUT/SAP/ADDITIONAL PURCHASE PRICE WOULD BE AND/OR CAN BE SAID TO BE AN APPROPRIATION OF PROFIT AND FOR THAT AN EXERCISE IS TO BE DONE BY THE ASSESSING OFFICER BY CALLING UPON THE ASSESSEE TO PRODUCE THE STATEMEN T OF ACCOUNTS, BALANCE SHEET AND THE MATERIAL SUPPLIED TO THE STATE GOVERNMENT FOR THE PURPOSE OF DECIDING/FIXING THE FINAL PRICE/ADDITIONAL PURCHASE PRICE/SAP UNDER CLAUSE 5A OF THE CONTROL ORDER, 1966. MERELY BECAUSE THE HIGHER PRICE IS PAID TO 12 SSK GROUP CASES BOTH, M EMBERS AND NON - MEMBERS, QUA THE MEMBERS, STILL THE QUESTION WOULD REMAIN WITH RESPECT TO THE DISTRIBUTION OF PROFIT/SHARING OF THE PROFIT. SO FAR AS THE NON - MEMBERS ARE CONCERNED, THE SAME CAN BE DEALT WITH AND/OR CONSIDERED APPLYING SECTION 40A (2) OF TH E ACT, I.E., THE ASSESSING OFFICER ON THE MATERIAL ON RECORD HAS TO DETERMINE WHETHER THE AMOUNT PAID IS EXCESSIVE OR UNREASONABLE OR NOT........ 9.5 THEREFORE, THE ASSESSING OFFICER WILL HAVE TO TAKE INTO ACCOUNT THE MANNER IN WHICH THE BUSINESS WORKS, T HE MODALITIES AND MANNER IN WHICH SAP/ADDITIONAL PURCHASE PRICE/FINAL PRICE ARE DECIDED AND TO DETERMINE WHAT AMOUNT WOULD FORM PART OF THE PROFIT AND AFTER UNDERTAKING SUCH AN EXERCISE WHATEVER IS THE PROFIT COMPONENT IS TO BE CONSIDERED AS SHARING OF PRO FIT/DISTRIBUTION OF PROFIT AND THE REST OF THE AMOUNT IS TO BE CONSIDERED AS DEDUCTIBLE AS EXPENDITURE. 6. BOTH THE SIDES ARE UNANIMOUSLY AGREEABLE THAT THE EXTANT ISSUE OF DEDUCTION FOR PAYMENT OF EXCESSIVE PRICE FOR PURCHASE OF SUGARCANE, RAISED IN MOST OF THE APPEALS UNDER CONSIDERATION, IS SQUARELY COVERED BY THE AFORESAID JUDGMENT OF THE HONBLE SUPREME COURT. RESPECTFULLY FOLLOWING THE PRECEDENT, WE SET - ASIDE THE IMPUGNED ORDERS ON THIS SCORE AND REMIT THE MATTER TO THE FILE OF THE RESPECTIVE A. OS. FOR DECIDING IT AFRESH AS PER LAW IN CONSONANCE WITH THE ARTICULATION OF LAW BY THE HONBLE SUPREME COURT IN THE AFORENOTED JUDGMENT. THE AO WOULD ALLOW DEDUCTION FOR THE PRICE PAID UNDER CLAUSE 3 OF THE SUGAR CANE (CONTROL) ORDER, 1966 AND THEN DETE RMINE THE COMPONENT OF DISTRIBUTION OF PROFIT EMBEDDED IN THE PRICE PAID UNDER CLAUSE 5A, BY CONSIDERING THE STATEMENT OF ACCOUNTS, BALANCE SHEET AND OTHER RELEVANT MATERIAL SUPPLIED TO THE STATE GOVERNMENT FOR THE PURPOSE OF DECIDING/FIXING THE FINAL PRIC E/ADDITIONAL PURCHASE PRICE/SAP UNDER THIS CLAUSE. THE AMOUNT RELATABLE TO THE PROFIT COMPONENT OR SHARING OF PROFIT/DISTRIBUTION OF PROFIT PAID BY THE ASSESSEE, WHICH WOULD BE APPROPRIATION OF INCOME, WILL NOT BE ALLOWED AS DEDUCTION, WHILE THE REMAINING AMOUNT, BEING A CHARGE AGAINST THE INCOME, WILL BE CONSIDERED AS DEDUCTIBLE EXPENDITURE. AT THIS STAGE, IT IS MADE CLEAR THAT THE DISTRIBUTION OF PROFITS CAN ONLY BE QUA THE PAYMENTS MADE TO THE MEMBERS. IN SO FAR AS THE NON - MEMBERS ARE CONCERNED, THE CA SE WILL BE CONSIDERED AFRESH BY THE AO BY APPLYING THE PROVISIONS OF SECTION 40A(2) OF THE ACT, AS HAS BEEN HELD BY THE HONBLE SUPREME COURT SUPRA. NEEDLESS TO SAY, THE ASSESSEE WILL BE ALLOWED A REASONABLE OPPORTUNITY OF HEARING BY THE AO IN SUCH FRESH DETERMINATION OF THE ISSUE. 7. IT IS NOTED THAT IN SOME OF THE APPEALS, THE ASSESSEES HAVE RAISED AN ALTERNATE GROUND FOR ALLOWING DEDUCTION U/S.80P IN RESPECT OF THE ADDITION. 8 . THE LD. ARS, IN SOME OF THE CASES, WHICH WERE REPRESENTED BY THEM, WERE FAIR ENOUGH NOT TO PRESS SUCH GROUND AS IT IS ONLY AN ALTERNATE GROUND AND HAVING BECOME INFRUCTUOUS IN VIEW OF THE RESTORATION OF THE MATTER TO THE AO. NO ARGUMENT WAS ADVANCED IN SUPPORT OF SUCH GROUND IN OTHER CASES, EVEN WHERE THE LD. ARS PARTICIPATE D IN PROCEEDINGS BEFORE THE TRIBUNAL. THEREFORE, THE SAID ALTERNATE GROUND IN ALL SUCH CASES IS DISMISSED. 13 SSK GROUP CASES 5. THUS, IN VIEW OF THE STATEMENT MADE BY BOTH THE SIDES THAT THE FACTS IN THE PRESENT SET OF APPEALS ARE IDENTICAL , THE ISSUE RELATING TO EXCESS SU GAR CANE PRICE PAID BY THE ASSESSEE IS RESTORED TO THE FILE OF ASSESSING OFFICER WITH SIMILAR DIRECTIONS AS ABOVE IN THE CASE OF MAJALGAON SAHAKARI SAKHAR KARKHANA LTD. VS. ACIT (SUPRA) . THE ASSESSING OFFICER SHALL DECIDE THE ISSUE AFTER AFFORDING REASONAB LE OPPORTUNITY OF HEARING TO THE RESPECTIVE ASSESSEES, IN ACCORDANCE WITH LAW. S ALE OF SUGAR AT CONCESSIONAL RATES TO THE MEMBERS/SHAREHOLDERS 6. THE L D. DR SUBMITTED THAT THIS ISSUE WAS DECIDED BY THE HONBLE APEX COURT IN THE CASE OF CIT VS. KRISHNA SAHAKARI SAKHAR KARKHANA LIMITED REPORTED AS 27 TAXMANN.COM 162. IN THE PRESENT BUNCH OF APPEALS WHERE THE ISSUE HAS BEEN RAISED, EITHER THE ORDERS WERE PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) PRIOR TO THE DATE OF JUDGMENT OF HONBLE SUPREME COU RT OF INDIA IN THE CASE OF CIT VS. KRISHNA SAHAKARI SAKHAR KARKHANA LIMITED (SUPRA) I.E. 25 - 09 - 2012 AND IN SOME CASES WHERE THE ORDERS HAVE BEEN PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) SUBSEQUENT TO THE DATE OF SAID JUDGMENT , T HE COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT CONSIDERED THE JUDGMENT RENDERED BY THE HONBLE APEX COURT ON THIS ISSUE. 7. WE FIND THAT THE ISSUE OF SALE OF SUGAR AT CONCESSIONAL RATES HAS ALSO BEEN CONSIDERED BY THE CO - ORDINATE BENCH IN THE CASE OF MAJALGAON SAHAKARI SAKHAR KARKHANA LTD. VS. ACIT (SUPRA) AND HAS HELD AS UNDER : 14 SSK GROUP CASES 11. HAVING HEARD BOTH THE SIDES AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD, IT IS OBSERVED THAT THE AO MADE ADDITION OF THE DIFFERENCE BETWEEN THE MARKET PRICE AND THE CONCESSIONAL P RICE AT WHICH SUGAR (FINAL PRODUCT) WAS GIVEN TO FARMERS AND CANE GROWERS. IN THIS REGARD, IT IS OBSERVED THAT THIS ISSUE HAS BEEN CONSIDERED BY THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. KRISHNA SAHAKARI SAKHAR KARKHANA LIMITED (2012) 27 TAXMANN.CO M 162 (SC). VIDE JUDGMENT DATED 25 - 09 - 2012, THE HONBLE SUPREME COURT NOTICED THAT THE DIFFERENCE BETWEEN THE AVERAGE PRICE OF SUGAR SOLD IN THE MARKET AND THE PRICE OF SUGAR SOLD BY THE ASSESSEE TO ITS MEMBERS AT CONCESSIONAL RATE WAS TAXED BY THE DEPART MENT UNDER THE HEAD APPROPRIATION OF PROFIT. THE HONBLE SUMMIT COURT REMITTED THE MATTER TO THE CIT(A) FOR CONSIDERING, INTER ALIA,: WHETHER THE ABOVEMENTIONED PRACTICE OF SELLING SUGAR AT CONCESSIONAL RATE HAS BECOME THE PRACTICE OR CUSTOM IN THE CO - OPERATIVE SUGAR INDUSTRY?; AND WHETHER ANY RESOLUTION HAS BEEN PASSED BY THE STATE GOVERNMENT SUPPORTING THE PRACTICE?; THE CIT(A) WOULD ALSO CONSIDER ON WHAT BASIS THE QUANTITY OF THE FINAL PRODUCT, I.E. SUGAR, IS BEING FIXED FOR SALE TO FARMERS/CANE GRO WERS/MEMBERS EACH YEAR ON MONTH - TO - MONTH BASIS, APART FROM OTHERS FROM DIWALI? THE ISSUE UNDER CONSIDERATION CAN BE DECIDED BY AN APPROPRIATE LOWER AUTHORITY ONLY ON THE TOUCHSTONE OF THE RELEVANT FACTORS NOTED IN THE ABOVE JUDGMENT. IN OUR CONSIDERED OP INION, IT WOULD BE JUST AND FAIR IF THE IMPUGNED ORDERS ON THIS SCORE ARE SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF AOS, INSTEAD OF TO THE CITS(A), FOR FRESH CONSIDERATION AS TO WHETHER THE DIFFERENCE BETWEEN THE AVERAGE PRICE OF SUGAR SOLD IN T HE MARKET AND THAT SOLD TO MEMBERS AT CONCESSIONAL RATE IS APPROPRIATION OF PROFIT OR NOT, IN THE LIGHT OF THE DIRECTIONS GIVEN BY THE HONBLE SUPREME COURT IN THE CASE OF KRISHNA SAHAKARI SAKHAR KARKHANA LIMITED (SUPRA). RESTORATION TO THE AO IS NECESSITA TED BECAUSE, FOLLOWING THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF TASGAON TALUKA S.S.K. LTD. (SUPRA), WE HAVE REMITTED THE ISSUE OF PAYMENT OF EXCESSIVE PRICE TO THE FILE OF AO, AND AS SUCH, THE INSTANT ISSUE CANNOT BE SENT TO LD. CIT(A) AS IT W OULD AMOUNT TO SIMULTANEOUSLY SENDING ONE PART OF THE SAME ASSESSMENT ORDER TO THE AO AND OTHER TO THE CIT(A), WHICH IS NOT APP ROPRIATE. WE ORDER ACCORDINGLY. 8. BOTH THE SIDES HAVE STATED AT THE BAR THAT THE ISSUE RAISED IN PRESENT SET OF APPEALS ARE I DENTICAL TO THE ONE ALREADY DECIDED BY THE CO - ORDINATE BENCH. THUS, IN VIEW OF THE ABOVE ORDER BY CO - ORDINATE BENCH THIS ISSUE IS RESTORED BACK TO THE FILE OF ASSESSING OFFICER FOR DE - NOVO ADJUDICATION IN SIMILAR TERMS . THE ASSESSING OFFICER SHALL GRANT REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. 15 SSK GROUP CASES DISALLOWANCE OF CONTRIBUTION TO AREA DEVELOPMENT FUND 9. WE FIND THAT THE CO - ORDINATE BENCH HAS CONSIDERED THIS ISSUE AND HAS RESTORED THE SAME TO THE FILE OF ASSESSING OFFICER B Y OBSERVING AS UNDER : 13. HAVING HEARD BOTH THE SIDES AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD, IT IS SEEN THAT SIMILAR ISSUE CAME UP FOR CONSIDERATION BEFORE THE HONBLE SUPREME COURT IN THE CASE OF SIDDHESHWAR SAHAKARI SAKHAR KARKHANA LIMITE D VS. CIT AND OTHERS (2004) 270 ITR 1 (SC). IN THAT CASE, THE HONBLE SUPREME COURT OBSERVED IN PARA 44 THAT THE RECEIPTS IN THE FORM OF AREA DEVELOPMENT FUND ALWAYS REMAINED WITH THE ASSESSEE. IT ALSO NOTED THE CONTENTION OF THE ASSESSEE IN PARA 45 THAT THE REALISATIONS MADE TOWARDS THE AREA DEVELOPMENT FUND WERE IMPRESSED WITH THE SPECIFIC LEGAL OBLIGATION TO SPEND THE MONEY FOR SPECIFIED PURPOSES WHICH WERE UNRELATED TO THE BUSINESS OF THE SUGAR FACTORY AND HENCE, COULD NOT BE TREATED AS INCOME OF THE ASSESSEE. EVENTUALLY, THE HONBLE SUPREME COURT REMITTED THE MATTER BACK FOR FRESH DETERMINATION. IT IS NOTICED THAT IN THE APPEALS UNDER CONSIDERATION, THE LD. CITS(A) HAVE NOT CONSIDERED THE IMPACT OF THE JUDGMENT OF THE HONBLE SUPREME COURT IN SIDDHE SHWAR SAHAKARI SAKHAR KARKHANA LIMITED (SUPRA) AND DECIDED THE ISSUE WITHOUT TAKING NOTE OF THE FACTORS DIRECTED TO BE CONSIDERED IN THE AFORENOTED CASE. IN VIEW OF THE ABOVE DECISION OF HONBLE SUPREME COURT, WE SET - ASIDE SUCH IMPUGNED ORDERS AND REMIT TH E MATTER TO THE FILE OF THE RESPECTIVE AOS FOR DECIDING THE ISSUE AFRESH IN CONFORMITY WITH THE GUIDELINES LAID DOWN BY THE HONBLE APEX COURT IN THE ABOVE JUDGMENT. 10. BOTH THE SIDES ARE UNANIMOUS IN STATING THAT THE ISSUE IN PRESENT SET OF APPEALS IS IDENTICAL TO THE ONE ALREADY DECIDED BY THE CO - ORDIN ATE BENCH. THUS, IN VIEW OF THE ORDER BY CO - ORDINATE BENCH THIS ISSUE IS DECIDED IN THE SAME TERMS. ACCORDINGLY, THE ISSUE IS RESTORED BACK TO THE FILE OF ASSESSING OFFICER. THE ASSESSING OFFICER SHAL L GRANT REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. PROVISION FOR VASANTDADA SUGAR INSTITUTE (VSI) CONTRIBUTION 11. THE AUTHORISED REPRESENTATIVES SUBMITTED THAT THE ISSUE OF PROVISION FOR VSI CONTRIBUTION HAS BEEN DECID ED BY THE CO - ORDINATE 16 SSK GROUP CASES BENCH IN FAVOUR OF THE ASSESSEES BY FOLLOWING THE ORDER OF TRIBUNAL IN THE CASE OF BHIMA S.S.K. LTD. IN ITA NO. 1414/PUN/2000. THE L D. DR FAIRLY ADMITTED THAT THIS ISSUE HAS BEEN CONSIDERED BY THE CO - ORDINATE BENCH . THE CO - ORDINATE BENCH WHILE DECIDING THIS ISSUE IN FAVOUR OF ASSESSEES HAS OBSERVED AS UNDER : 18. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD. IT IS FOUND THAT THE LD. CIT(A) HAS DETERMINED THIS ISSUE IN FAVOUR OF THE ASSESSEE BY F OLLOWING THE ORDER PASSED BY THE PUNE BENCHES OF THE TRIBUNAL IN THE CASE OF BHIMA S.S.K. LTD. (SUPRA). NO MATERIAL HAS BEEN PLACED ON RECORD TO SHOW THAT THIS ORDER OF THE TRIBUNAL HAS BEEN REVERSED OR MODIFIED IN ANY MANNER BY THE HONBLE HIGH COURT. R ESPECTFULLY FOLLOWING THE PRECEDENT, WE DECIDE THIS ISSUE IN FAVOUR OF THE ASSESSEE. 12. THUS, IN VIEW OF THE ABOVE FINDINGS OF THE TRIBUNAL AND SUBMISSIONS OF BOTH THE SIDES, THE ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE. DISALLOWANCE OF E MPLOYE ES C ONTRIBUTION TOWARDS PROVIDENT FUND 13. ANOTHER ISSUE IN SOME OF THE APPEALS IS DISALLOWANCE OF CONTRIBUTION TOWARDS PROVIDENT FUND AFTER THE STATUTORY TIME BUT BEFORE THE DUE DATE OF FILING RETURN OF INCOME . THE LD. AUTHORISED REPRESENTATIVES SUBMITTED THAT ADMITTEDLY THERE WAS DELAY IN DEPOSIT OF CONTRIBUTION TOWARDS PROVIDENT FUND BUT THE AMOUNT WAS DEPOSITED BEFORE DUE DATE OF FILING RETURN OF INCOME BY THE RESPECTIVE ASSESSEES . THIS ISSUE HAS BEEN SETTLED BY THE HONBLE SUPREME COURT OF INDIA IN THE CASE OF COMMISSIONER OF INCOME TAX VS. ALOM EXTRUSIONS LTD. REPORTED AS 319 ITR 306. 17 SSK GROUP CASES 14. THE ASSESSEES ELIGIBILITY TO CLAIM DEDUCTION OF DELAYED DEPOSIT OF EMPLOYEES SHARE IN PROVIDENT FUND SCHEME BUT BEFORE DUE DATE OF FILING RETURN OF INCOME IS NO MOR E RES INTEGRA . THE HONBLE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. GHATGE PATIL TRANSPORTS LTD. REPORTED AS 368 ITR 749 AFTER CONSIDERING THE JUDGMENT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. ALOM EXTRUSIONS LTD. (SUPRA) HELD THAT DEDUCTION TO BE ALLOWED ONLY ON ACTUAL PAYMENTS BEFORE THE DUE DATE OF FILING RETURN OF INCOME AND THE AMENDED PROVISIONS OF SECTION 43B APPLIES TO BOTH EMPLOYEES AND EMPLOYERS CONTRIBUTION. IN THE PRESENT SET OF APPEALS IT IS NOT DISPUTED BY THE R EVENUE THAT THE CONTRIBUTION WAS MADE BEFORE THE DUE DATE OF FILING RETURN OF INCOME. THUS, IN VIEW OF WELL SETTLED LAW AND THE FACTS OF THE CASE , THIS ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEES. DISALLOWANCE OF CONTRIBUTION TOWARDS CHIEF MINISTER FUN D 15. ANOTHER ISSUE IN SOME OF THE APPEALS IS DISALLOWANCE OF CONTRIBUTION BY ASSESSEES TOWARDS CHIEF MINISTER RELIEF FUND. WE FIND THAT THIS ISSUE HAS BEEN CONSIDERED BY CO - ORDINATE BENCH IN THE CASE OF MAJALGAON SAHAKARI SAKHAR KARKHANA LTD. VS. ACIT ( SUPRA) AND HAS HELD AS UNDER : 21. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD. THERE IS NO DISPUTE THAT THE ASSESSEE DID MAKE CONTRIBUTION TO THE CHIEF MINISTER RELIEF FUND. AS AGAINST THE ASSESSEE CLAIMING THE ENTIR E AMOUNT AS DEDUCTION IN ITS PROFIT AND LOSS ACCOUNT, THE AO OPINED THAT THE SAID CONTRIBUTION WAS ELIGIBLE FOR DEDUCTION U/S. 80G(IIIHF) OF THE ACT AT THE RATE OF 50% ALONG WITH OTHER QUALIFYING SUMS. THE LD. CIT(A) SUSTAINED THE ENTIRE ADDITION OVERLOO KING THE FACT THAT DEDUCTION U/S.80G(IIIHF) WAS NOT ALLOWED BY THE AO ON SUCH CONTRIBUTION IN THE COMPUTATION OF TOTAL INCOME. UNDER THESE CIRCUMSTANCES, WE CANNOT UPHOLD THE DISALLOWANCE OF THE ENTIRE AMOUNT CLAIMED AS DEDUCTION BY THE ASSESSEE IN ITS PR OFIT AND LOSS ACCOUNT. APPROVING THE ADDITIONS MADE, WE REMIT THE MATTER TO THE FILE OF THE AO FOR GRANTING THE DEDUCTION 18 SSK GROUP CASES U/S.80G(IIIHF) AS PER LAW AFTER ALLOWING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 16. IT IS AN UNDISPUTED FACT THAT THE ISSUE IN THE PRESENT SET OF APPEALS IS IDENTICAL. THUS, FOLLOWING THE ORDER OF CO - ORDINATE BENCH, THE ISSUE IS RESTORED TO THE FILE OF ASSESSING OFFICER TO BE ADJUDICATED IN SIMILAR TERMS. THE ISSUE IS ALLOWED FOR STATISTICAL PURPOSE. DISALLOWANCE OF INTEREST ON LOANS U/S. 43B 1 7 . THE LD. AUTHORIZED REPRESENTATIVES SUBMITTED THAT DISALLOWANCE U/S. 43B IS IN RESPECT OF INTEREST PAID TO THE BANKS AND FINANCIAL INSTITUTIONS. IN THE PRESENT CASE, THE LOANS HAVE BEEN MADE AVAILABLE BY THE GOVERNMENT . TH E BANKS/FINANCIAL INSTITUTIONS WERE ONLY MODE OF DISBURSING LOANS TO THE SUGAR KARKHANA , THE PROVISIONS OF SECTION 43B ARE NOT ATTRACTED. ON THE OTHER HAND L D. DR VEHEMENTLY SUPPORT ED THE FINDINGS OF ASSESSING OFFICER ON THIS ISSUE. 18. A PERUSAL OF IMPUGNED ORDER SHOWS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS GRANTED RELIEF TO THE ASSESSEES AFTER PLACING RELIANCE OF GOVERNMENT RESOLUTION BEARING NO. 1004/380/NO.99/13 - 5 DATED 20 - 05 - 2004. THE SAID RESOLUTION IS IN CONNECTION WITH MID TERM LOA N GRANTED TO THE SUGAR FACTORIES AT INTEREST RATE OF 2% PER ANNUM. THE LOAN HAS BEEN PROVIDED BY THE GOVERNMENT AND HAS BEEN DISBURSED THROUGH BANK S /FINANCIAL INSTITUTIONS. THIS FACT HAS NOT BEEN DISPUTED BY THE REVENUE. IT IS NOT A CASE WHERE THE LOANS HAVE BEEN GRANTED TO THE SUGAR FACTORIES BY THE BANK S /FINANCIAL INSTITUTIONS. THUS, IN THE PECULIAR 19 SSK GROUP CASES FACTS OF THE CASE WE CONCUR WITH THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN HOLDING THAT THE PROVISIONS OF SECTION 43B ARE NOT ATTRACTED. WE CONFIRM THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) ON THIS ISSUE. CONSEQUENTLY, THE ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEES. HARVESTING AND TRANSPORT ATION EXPENDITURE 1 9 . IN SOME OF THE APPEALS THE ISSUE OF DISALLOWANCE OF CANE HARVEST ING AND TRANSPORTATION EXPENDITURE INCURRED BY THE ASSESSEES HAS BEEN RAISED. THE EXPENDITURE HAS BEEN DISALLOWED BY THE ASSESSING OFFICER. WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEES BY CBDT CIRCULAR NO. 6/2007, DATED 11 - 10 - 20 07. FOR THE SAKE OF READY REFERENCE THE SAME IS REPRODUCED HERE - IN - BELOW : 1. INSTANCES HAVE COME TO THE NOTICE OF THE BOARD WHEREIN ASSESSING OFFICERS HAVE DISALLOWED THE CLAIM OF HARVESTING AND TRANSPORTATION EXPENSES INCURRED BY THE CO - OPERATIVE SUGAR MILLS FOR PROCURING SUGARCANE FROM FARMERS, WHO ARE MEMBERS OF SUCH CO - OPERATIVE SUGAR MILLS AND WHO ARE BOUND UNDER AN AGREEMENT TO SUPPLY THE SUGARCANE EXCLUSIVELY TO THE CONCERNED SUGAR MILL. 2. THE ISSUE OF ALLOWABILITY OF SUCH EXPENSES IN THE CASE OF CO - OPERATIVE SUGAR MILLS HAS BEEN EXAMINED BY THE BOARD. THESE EXPENSES ARE INCURRED BY THE SUGAR MILLS FOR ENSURING AN ADEQUATE AND SUSTAINED SUPPLY OF FRESHLY CUT SUGARCANE THAT IS AN ESSENTIAL INPUT FOR THE CONTINUOUS RUNNING OF SUCH MILLS. THESE EXPEN SES ARE, THEREFORE; INCURRED FOR A COMMERCIAL EXPEDIENCY AND ARE PRIMA FACIE WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. SUCH EXPENSES ARE, THEREFORE, ALLOWABLE IN THE COMPUTATION OF THE INCOME OF THE CO - OPERATIVE SUGAR MILLS. 20 SSK GROUP CASES THUS, IN VIEW OF CBDT CIRCULAR THE HARVESTING AND TRANSPORT ATION EXPENDITURE ARE ALLOWABLE. CONSEQUENTLY, THE ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEES. 20 . IN THE RESULT, THE APPEALS ARE ALLOWED /PARTLY ALLOWED FOR STATISTICAL PURPOSE IN THE MANNER AFORESAID AS T HE CASE MAY BE . ORDER PRONOUNCED ON WEDNESDAY, THE 20 TH DAY OF MARCH, 2019. SD/ - SD/ - ( . /D. KARUNAKARA RAO) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 20 TH MARCH, 2019. RK/SUJEET / COPY OF THE ORDER FORWA RDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) CONCERNED 4. / THE CIT CONCERNED 5. , , , / DR, ITAT, B BENCH, PUNE. 6. / GUARD FILE. // // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE